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How Much Does it Cost You to NOT Sell?
How Much Does it Cost You to NOT Sell?

 
Tuesday, October 15, 2013
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With all the national and regional news on home sales values increasing, I am approached by many home owners looking to list their homes on the market. It is true that the available property on the market is in limited supply, and there are many buyers on the market looking to purchase properties. However, in a number of instances, seller expectations are out of sync with the market value of their homes. Home prices have increased substantially in the past year and while this is excellent news, there is a danger amongst those looking to sell their homes in listing it too high.   Buyers will not pay over market value for a home, even when inventory is scarce. Pricing must reflect what the market will bear, not what the Seller needs to net.

If you are asked by your realtor to lower your list price or are in possession of an offer that you feel is too low, consider the yearly costs of keeping your home. Often, the cost of keeping the home could impact that decision in the long term. One factor that is not even computable is the opportunity cost in not selling due to market fluctuations. An example of this would be if a new development of comparable homes becomes available on the market, thereby increasing the inventory, and your home value will be reduced. Below is a rough estimate of carrying costs based on expenses for an average two bedroom 1100 sq. ft. condominium  near the beach. If you have thought about selling your property please call me for a free consultation and honest discussion of your home value.

Average Homeowner Insurance: starting at $1100 per year (Florida average),  although this can vary significantly based on amount of coverage and proximity to the ocean..

Taxes: Roughly 2% of the sale price $5,000 (average based on $250,000 property)

Monthly Assessments: For the majority of condominiums near the beach that fund reserves, this averages between .50 and .59 per sq. ft. or roughly  $600 per month, yearly $7,200

Utilities: Electricity varies with usage but an average could be $100/month ($1200/year). High speed Internet $69/month ( $828/year)

Total Amount of Costs: $15,328 excluding a mortgage payment and any additional repairs and maintenance or building assessments.

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